Here are five warning signs that you credit card debt might be getting out of control…
(When you’re done reading these five warning signs, head over and check out five more warning signs of credit card debt danger!)
1. You make just the minimum payments.
Making the bare minimum payments is sometimes necessary, like when a temporary financial crisis arises. However, if you find yourself making the minimum payments on your credit cards month after month, this is a warning sign that you might have a credit card debt problem. Making only the minimum payments on your credit card debt means that you’ll be paying way more in interest than you need to and paying for much longer than you need to.
2. You don’t know how much credit card debt you owe.
And you may not even want to know! If you don’t know how much you owe in credit card debt and other debt, you’re unable to get a good idea of your overall financial situation. You may even be at risk of going over your credit limit. Plus, not wanting to know how much you actually owe because it scares you? That’s a big red flag that you might be getting into some serious credit problems! You can get a good idea of your credit card situation with a simple spreadsheet. You can even download a Credit Card Overview Google spreadsheet to help you. Just make sure you’re logged into your Google account, head over here, click on “File“, then click on “Make a Copy” to copy it to your own Google Docs account to get started. You can also download it as a Microsoft Excel or OpenDocument spreadsheet.
3. You ignore communication from creditors.
Ignoring communication from your creditors is a huge red flag that your credit card debt is getting out of control! This can include ignoring phone calls or simply not opening the credit card statements that come in the mail. This is usually a sign that don’t want to deal with your debt or it’s just too scary for you to accept. Ignoring this communication and hiding from your problems also means that you may miss out on important updates or that you may not want to know how much you owe. (See #2 above.)
4. You charge more than you pay.
As a general rule, try not to charge more than you are able to pay off by the next billing statement. In some cases, this is acceptable, such as when you need to make a large necessary purchase like a large appliance or emergency vehicle maintenance. However, if your’e charging more than what you pay almost every month, you could be heading for trouble.
5. You use credit cards for essentials because you have no cash.
It’s one thing to whip out the credit card to pay for groceries in order to take advantage of a sweet rewards program, as long as you pay off the balance. It’s a whole ‘nother thing to whip out the credit card for essential everyday purchases because you simply don’t have the money. If this is the case, you may want to consider a debt consolidation loan, a balance transfer, or credit counseling.
Still not sure if credit card debt is becoming a problem for you? Head over and check out five MORE warning signs…
